Local Government Bill 2018

Division 2—Special purpose charges

Clause 110 empowers a Council to declare a special purpose charge on rateable land for the purpose of paying the expenses of providing works or services that are a function of the Council. Expenses may include interest on associated borrowings.

Subclauses (2) and (3) state that a Council may only declare a special purpose charge where the owner or occupier of the land will derive a special benefit that is additional to or greater than the benefits to other properties.

Subclause (4) allows a Council to declare a special purpose charge on non-rateable land if it is for the purpose of street construction.

Subclause (5) requires a Council in declaring a special purpose charge to provide detailed information on the inclusions, costs, payment options and interest costs that apply to the works.

Clause 111 describes some essential conditions that apply to the levying of a special purpose charge.

Subclause (1) requires the Council to determine the total amount to be levied and the criteria to be used as a basis for declaring the charge.

Subclauses (2) and (3) require the Council to be satisfied on reasonable grounds that the proposed special purpose charge complies with 3 specified conditions. It is intended that this will require a Council to consider each of these conditions and, on the basis of information and analysis, satisfy itself that the conditions will be met.

The specific conditions require—

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  the estimated costs must be comparable with the costs of similar works or services;
  

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  the amount to be recovered under special purpose charges must not exceed the proportion of the total benefits that will be of special benefit to the owners or occupiers required to pay the charges; and
  

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  the criteria used to apportion the special purpose charge between persons is fair and reasonable considering the nature of the works or services and the relative special benefits involved.
  

Clause 112 describes the community engagement requirement that must precede the declaration of a special purpose charge.

Every person who would be required to pay a special purpose charge must be given a notice containing the information described in this clause and given an opportunity to make a submission.

If the objection process in clause 113 applies, the person must also be advised of their right to object and given the information about how to object.

Clause 113 provides for an objection process that must be conducted before a Council can declare a special purpose charge that will recover more than two-thirds of the total costs of the relevant works or services.

An objection may be made by the owner of the land subject to the proposed charge or by the occupier of that land if it is nonresidential land.

If the Council receives written objections from the owners or occupiers of a majority of the properties on which the special purpose charge is proposed to be levied, it must not declare the charge.

Clause 114 deals with the declaration of a special purpose charge.

Subclause (1) prevents a Council from declaring a special purpose charge in the following circumstances—

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  where more than 12 months has passed since the notice of intention to levy was issued under clause 112; or
  

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  when the amount that a person will be required to pay varies from the amount stated in the notice under clause 112 by more than 10 per cent.
  

The purpose of these restrictions is to ensure ratepayers are not required to pay a special purpose charge for which notice was given at a significantly earlier date and possibly to a prior owner as well as ensuring the amount to be paid remains consistent with the notice.

Subclauses (2) and (3) provide for a Council to levy a special purpose charge by sending a notice to the person required to pay that includes the prescribed information.

Clause 115 provides that a Council may discontinue a special purpose charge. Affected ratepayers must be notified.

Clause 116 requires a Council to refund excess funds raised by a special purpose charge. This may apply where the costs of the works or services were less than expected or where a scheme has been discontinued under clause 115.

Clause 117 places restrictions on a Council's ability vary a special purpose charge.

A Council must not vary a special purpose charge by requiring a person to pay more than 10 per cent more than the original charge, after adjusting for inflation. Nor may the Council make a variation that would extend the special purpose charge to land previously not included.

Clause 118 provides for appeals to the Victorian Civil and Administrative Tribunal (VCAT) in regard to special purpose charges.

Subclauses (1) and (2) entitle a person affected by a special purpose charge to apply to VCAT for a review of either the decision to levy the charge or a decision to vary the charge. The application must be within 60 days of the levy notice.

Subclause (3) describes the grounds on which an application may be made. These are that the person or their land will not derive a special benefit or that the Council has not complied with the provisions of this Division before declaring the special purpose charge.

It is intended that an application on the ground that the Council has failed to comply with this Division may refer to an alleged failure to follow a required process, such as the objection process in clause 113 or to a failure to ensure that it is satisfied on reasonable grounds that the specific conditions in clause 111 are complied with.

Subclause (4) describes the orders that may be made by VCAT. This includes excluding land from the scheme, setting aside the entire special purpose charge, dismissing the application for review or making any other declaration VCAT considers appropriate.

Subclause (5) ensure that a decision by VCAT to set aside a special purpose charge does not prevent the Council from declaring a new special purpose charge for the year. It is intended that any new declaration must follow the required processes and satisfy the special conditions in the same way as the original declaration.